And that means you can claim tax back on this…
Here's an example of how you can claim input tax on costs attached to local flights.
Let's say Glen buys a return ticket from OR Tambo (Johannesburg) to Cape Town on Kahlua Airlines. He buys the ticket through his travel agent, who gives him a tax invoice for R1 824.
Being an accountant, Glen asks the travel agent for a breakdown of the charges. They're as follows:
The answer is simple: The Vat Act allows the travel agent, provided he' is a vendor, to issue his tax invoice including charges (plus Vat) on supplies made by other vendors. So becauset Glen has a valid tax invoice, he can claim input tax in his business. But to do this, he must keep the travel agent's tax invoice for five years.
Basically, the travel agent doesn't declare output tax on the supplies made by his principles (Kahlua and ACSA), but they exchange information with him by means of a monthly statement so that they can declare the right amount of output tax.
Here's what you must remember about claiming tax on local flights:
If Glen booked his flight online, he'd get an e-ticket from Kahlua Airlines showing not only his airfare, but ACSA's passenger service charge as well. His ticket would cost R1 824, including Vat of R224, which he can claim as input tax, provided it was a business trip. He must keep a copy of his e-ticket for five years.
Use this checklist to guarantee your input tax claim on local flights
Just remember, you can't claim input tax on shuttle ortaxi fees to and from the airport as these are Vatexempt.